Good afternoon and welcome to the aspen institute. My name is nick burns, executive director of the Aspen Strategy Group and the aspen security forum. Its a great pleasure to see this crowd. You all again cspan so be on your best behavior. And we are here to launch a a y important book on the future of the u. S. China relationship called the struggle forth powe. I agree friend could not be here with us but hes very much part of this effort. I want to pay tribute to our former secretary of defense and good friend of mine, secretary bill and mister janet , secretary , janet, welcome. In i also want to pay tribute to i think one of the people for me and bodies bipartisanship. Hes involved in every effort to bring peopletogether across partisan lines and thats steve hadley, our former National Security advisor here as well. Our director is jan and 90 well, we you will be seeing anja as one of the people doing the interviews. The subject is china. I think all of us agree our relationship with china will be the greatest challenge we face as a country in the next several decades and its an important moment in that relationship. We established full diplomatic relations in march 1979, jimmy carter and deng xiaoping. We felt in previous administrations we were seeking cooperation with china. That was a basic strategy and the chinese felt the same way. In recent years theres no question both countries have swung from cooperation to a strategy of competition and competition gets to the heart of our Vital National interest overseas. We are competing for Strategic Military predominance in the indo pacific where the United States has been the dominant power with our allies and south korea and australia for 75 years but the chinese are making a concerted effort to cut into that American Military power. We are ctcompeting to see who will dominate the next generation of military technology and 2years ago the Aspen Strategy Group spent three days thinking about that subject ai is going to be militarized. Quantum computing is going to be militarized. Biotechnology is going to be militarized. Which country will get their first in the new generation of military technology thats going to find power in the world . In the next several decades . We are also certainly competing as the number one and two economic powers in the world. You seen President Trump with his trade negotiations with the chinese in the first days deal that was announced last week but certainly competing economic primacy and from the perspective of the United States i support President Trump and what hes trying to do to get at the heart of chinese difficulties. Will the chinese agreed to live on a level Playing Field in terms of trade with japan, with europe and the European Union o . Finally we think about these battles i just talked about. Strategic predominance in the indo pacific, military technology,trade. Theres a fourth battle and i want to talk to secretary rice about this. The battle of ideas. Xi jinping is brimming with selfconfidence about the authoritarian model h. He thinks it should be exported and he thinks other countries should adopt it and Vladimir Putin thinks the same way and mohammed bin solomont and president erdogan think the same way. Europeans disagree, japanese disagree. Its not a cataclysmic battle of armies, its a battle of systems and ideals about how we think society should be organized. The one cautionary note that we spent three days, republicans and democrats and independents together debating this issue, we produced this volume that all of you i hope have a copy of, if you dont there are Copies Available in theback. We produced it on a nonpartisan basis. But even those of our organization as we are americans, we believe in our country first, we do not believe that artisan chip should be interfere with our analysis of being strategic challenges like this. But the big cautionary note would be this. Are we overestimating chinas strength and underestimating chinas weaknesses . Are we even underestimating the ability of the United States and its allies in europe and in asia lito cope with this threat peacefully and successfully. We have someone here in connie rice who spent the better part of her academic career thinking about an empire that crash. The soviet union and there were times when we were working together steve. Myself, secretary collins and maybe the 70s and 80s when we overestimated the strength of the soviet union. Do we have selfconfidence, i think the United States and its allies have a way forward or success in the 21st century and i commend this volume to you. We have republicans, democrats and independents writing on it and today were going here from four people, my colleague jan emanuel will interview mike chill street, mike is an advisor to President Trump. Hes a china specialist, hes really smart and hes a Hudson Institute and it was a pleasure to spend three days with mike earlier this year. The second interview i interviewmy close friend and Condoleezza Rice about these issues. Third interview im going to interview Kathleen Hicks who is one of i think the smartest young strategists we have in the United States on the positioning of the American Military and our ability to respond to these threats. Shes at cis for secretary is on the board and forth , anja will interview a guy who is a force of nature, kurt campbell, ambassador Kirk Campbell forfor president obama was our assistant secretary of state for east asia , architect of the strategic at the United States must make to the indo pacific, a compelling thinker on these issues and so we have to or conversations. We hope it will be useful to you. We thank you for beinghere and without further ado , Mike Pillsbury. [applause] all for being here today. I have to say as a, when we were in aspen last august, i thought we had one of the best discussions weve ever had as a Strategy Group in terms ofdepth of substance , diversity of opinion but being respectful of each others differences of opinion and you will see we ot have a slightly different format today and we would normally do a bunch of big panels where everybody talks. We wanted to highlight a couple of our authors for the books and give each of them really an opportunity to dig deep into what theyare trying to say and mike . Of course need no introduction. But im going to do it anyway. A fellow at the Hudson Institute, former senior Government Official in the Reagan Administration and elsewhere. Currently i siwould say youre always modest but i would say you are the number one outside advisor to the administration on china. Back channeling if i could say so you took six trips in preparing for this trade deal so it does not. It was. It was, we will stipulate that. But so i wanted to start broad and then narrow its day. Im not asking youto speak for the administration but you know a lot about what they think. What is the Trump Administrations objectives . Whats the goal with respect to china . Is it to level the Playing Field and try to get along and muddlethrough . Is it pushing back aclike we did on the soviet union . Is the goal that you get a different system there, what are we driving for . I think the first point to make on the Trump Administration, sorry. If i can edit my remarks. I think the first point to make about the trumpet ministration is the multiple voices within it. Who from the point of view of the standards established by previous administrations shamelessly leak their debates. Often on the front pages of the wall street journal. You will read Something Like yesterday in the oval office, someone said this, someone said that. So this is an administration that its very difficult to for outsiders to understand who speaks for the administration. So in my view, its the president alone. And one thing we are learning from the ukrainian impeachment discussion, seems to me is a permanent bureaucracy up to and including the cabinet and secretaries are not henecessarily involve in what the president concerned with. So my observation and i was not a Trump Campaign supporter, my candidate lost. But i was still invited to the Transition Team and what i learned from the very beginning is the president elect the time was deeply personally interested inchina. This surprised me. I thought during the campaign when he would frequently say phrases like china is raising our country, i thought this is Just Campaign rhetoric. Its clearly worse in some counties area and thats the end of it. But in fact, the president has acted as i say in my chapter in the book we are here to discuss today, the president began to act as a china desk officer himself. And as the china hand, people like david chan about here in the room andlonnie henley and others, we should all be thrilled thatthe president himself is taking china very seriously. Many president s really havent. But the hazard to that is that everybody around him once the influences view. And find out what his view actually is. And over threeyears , when ive come to understand about President Trumps opposed to china, he think of himself as a dealmaker. Hes a businessman, a billionaire and he wants to make a deal with in some sense another company which happens to be run by another ceo. Xi jinping so his focus from the beginning during the transition was on xi jinping. And one of the early developments was he had in my view unfortunately made a phone call, taking a phone call from taiwans president or as thechinese say socalled president. And the chinese began to punish the trumpet ministration for that phone call. It would not have a summit anywhere until the president clarified his views. But the way he did that set the tone for the next three years. He said at the request of president xi jinping in the phone call i am going to abide by our one china policy that opened the, that removed the obstacle for the morrow i go summit. So im not quite sure where you want to go. You know the president s mind on this as well as anyone and its possible that omthere are multiple goals here but is it watching as a total outside observer, i live in california and i sometimes hear from demonstrations announcements we are looking for china to really fail. Sometimes i hear no, were just trying to create a fair Playing Field here so our companies can compete and that we can have our own spheres of influence and find a way to all get along. Which end you think he falls on . Ive been advocating a president to give a speech on china himself an answer these kinds of questions you are raising. The Vice President has given2 speeches in great detail. But they too have created questions. What exactly is he saying . Hes saying we dont want to come but compete but people, steve bannon in particular and this committee on the present danger from china which im not a member of, they began talking about no, the coupling is exactly our goal. And in fact it is happening quite inadvertently. So if the president were to give aspeech on china himself , i think you and others in this room would be well advised to suggest what should be cleared up. I think theres considerable ambiguity and my own view of the all this, the president for some reason i dont understand invite me into the oval office to witness some of these debates. And there they are. T you participate or witness mark. Uses me kind of asa foil. And it doesnt take long before you realize who in the room likes me to be there and who doesnt. So that debate continues and ithink the president. I wont ask you the obvious followup. I think the president did this as a businessman. When i joined the Transition Team i placed my order with amazon. Com for all 14 books the president has coauthored area and several of them have china sections where he lays out some of his thinking. Next time a new president comes in and youre working for him or her i recommend read all those books before you go to the first meeting. And theyre pretty tough, i read some of those sections. Has a point about good china, bad china which he hasnt said publicly yet but its in the book and he lays out a good china that he would like to see and then he demonizes a bad china. And he implies something that Steve Schwartzman have said several times on television this really, the whole course of us china relations to a large degree is up to china in the debate theyre having. They have their steve bannon and they have their peter navarro. They have their steve nguyen. And that debate is part of what im supposed to be following. Because ive known some of these scholars and former officials for 30 years. Let me go there with you next, youve obviously written the book 100 year usmarathon thats now required reading in all of washington, its an excellent book. When you go to china and i traveled to china fairly recently refrequently i see the hardliners winning. And its harder and harder for the reformers who want domestic reform for their own purposes, much less anyone who wants political reform to really get the ear of their president. And the worry is that the hardliners on both sides are winning and that driving up the parts, is that what you see . Yes and its also what Henry Kissinger warned about and the very last chapter of his book on china, that his nightmare and he forgot what he called an unfathomable war on the scale of world war i to the us and china. The hawks on both sides into power. And he mentioned, i got the title hundred year marathon from one of the chinese box. I know pretty well and doctor s kissinger spent a whole page on that particular hardliner. His name is leo ming food, we had him on his first visit to america a Cocktail Party for him. I took him over to the pentagon but doctor kissinger said this will never happen. This is a fringe element who reflects some stream of thinking but this will never happen. But it did. So i think the hardliners which is a very vague term and by the way, the china field and cia have noted great deal about the hardliners along area but the general estimate has been they were not very powerful and in many ways, all of us fell victim to the Foreign Ministry in beijing telling us these hardliners have no power. Nobodylistens to them. Ns and its sort of the ones you were allowed for western events reedit you rate kissinger at a Bloomberg Forum happened in november. Kissinger famously said we are in the foothills of the cold war with china. That doesnt mean we need to go all the way. Where do you see the administration going . Yousee them pushing toward the cold war or do you see them wanting to pull back . Again, many voices are inside the administration. I dont think the president wants the cold war with china at all. I think hes quite aware of chinas military improvements but you will note his little micro indicators like the South China Sea, to what degree do our freedom of navigation controls observed oninnocent passage rules or they dont turn on their weapons radar, they dont go in circles, go at night. Theres five criteria in the law of the sea treaty for how you can make innocent passage without challenging the countrys actual territorial claims reedit seems to me as iunderstand from Navy Spokesman , we have not aggressively challenged the chinese with these kind of maneuvers, we come close and theres a wonderful harvard study about this and i dont know if youve seen people referenced the study on exactly how we approach the issue of freedom ofnavigation missions that change. If the whole trade deal goes sour, and the trade deal is veryvoluntary on both sides , i could envision a cold war breaking out inadvertently for lack of a better word to read and when you look back at the details of howdid the first cold war start, its not as though the two sides in 1940 6a okay, lets add the cold war. It is a series of blunders. At some point you had that extra article and we did formallylaunch it. And you think were not quite there yet with china. I agree with kissingers phrase about the foothills of the cold war. Ithink it can be avoided but it takes two sides. And the intricacies of this trade agreement could have laid the foundation for a cold war. I do want to get to the trade agreement you were so instrumental in helping get it through. Its uga real accomplishment. But we get there slightly instituted lease because you mentioned freedom of navigation in the South China Sea and in the us at least in the news cycles weve been so fixated on the trade side of this. I want to get your views a little bit on the other parts of that relationship. Whats happening diplomatically and on the securities fear. You spent a lot of time in your paper which was excellent, i have it all marked up talking about our allies in asia. And what each of them are on doing and especially on the military side. I thought this paper was excellent, it made some really good points about what we are alreadydoing , what we should be doing more with our allies reedit when you see the administrations defense policy, you see some of that also in my view inconsistently, you see them asking japan to more than triple its payment for our basis and the south korea, same thing. Triple th